There has been a considerable rise in the number of vacant residential units available for rent as compared to the situation around six months ago, according to industry insiders.
Some agents said they were finding it difficult to get new tenants even after offering reduced rents in some cases, pointing to a slowdown in demand.
“It is for almost two months now that I have been posting advertisements about a vacant apartment in a villa through different websites and other means. However, no serious tenant has shown up yet. I even reduced the rent by 10-15% but continued to get the same response. I cannot reduce it further because I have to pay a set amount as rent to the owner of the villa,” said an expatriate who sublets apartments.
Several others operating in the real estate sector, including representatives of realty firms as well as individual agents, confirmed this trend.
“I have a number of units in the Rayyan area, including those (portions of a villa) with monthly rents of above QR4,500. However, these have been lying vacant for a few months now but we cannot help it because the owner will not accept lower rates. Six months ago, the market saw a surge in demand and there was a shortage of units on offer, which made rents go up. However, I think this has changed now,” said a real estate agent who described himself as a “freelancer”.
Some feel that rents may come down if the ongoing trend continues.
“It is only a matter of time… if things go on like this, we will see more reasonable rates in the market,” said an agent working in a real estate company, affirming that demand has dropped of late and there are a number of vacant units waiting for tenants.
He stressed that lower rents would be highly instrumental in reviving the market and attracting new tenants.
However, while some agents believe that “more reasonable” rents are a likelihood in the future if one goes by current indicators, there are some people who prefer to keep their properties vacant than give them on rent at lower rates, say the insiders.
“Some people want to control the market artificially and not follow demand-supply rules, but this may not last for long. Eventually, market realities will dictate rents,” said another real estate agent.
There have also been some cases of property managers asking for a hike in rent, including for partitioned villas, by anything between QR250 and QR700, it is learnt. They say such hikes have been necessitated by inflated water and electricity bills.
However, for a majority of tenants, the rise in utility bills has not affected their rents yet.